When your business is dealing with a legal dispute, it can take a huge toll on your mental and emotional health. The legal process can eat up your time and energy and distract you from your business’ health and growth. If your legal issue has to be dealt with in court, it could go on for several months or even years depending on how complex it is and who is involved.
With alternative dispute resolution (ADR) you can potentially resolve legal issues without wasting excessive amounts of time, energy, and money. Here are three things you should know about alternative dispute resolution.
1. You Can Use ADR to Avoid Litigation
Alternative dispute resolution is a family of strategies you can use to possibly avoid litigation. Individuals, businesses, and governments use ADR because the cost of litigation is massive and only getting higher. Not only that, but courts are backed up due to the current COVID-19 pandemic, and there may be other time delays that can cause to drag on for months or years.
However, you have to keep in mind that you cannot always avoid litigation. For instance, if you are trying to dissolve a business partnership with a partner who is combative and abusive, you may have no other choice but to go to court to work out your issue. Both parties must be willing to invest in alternative dispute resolution in order for it to work; when they can’t, then the traditional legal process may be the only option.
2. There Are Different Types of Approaches to ADR
Mediation is probably the most common form of ADR. In a mediation process, a specially trained third-party mediator tries to help the parties reach a resolution they can live with. Mediation is non-binding, but the mediator may be aggressive in pushing the parties to make concessions and reach a compromise.
Typically, most people think alternative dispute resolution just means mediation, but there are other types of ADR. These different types of ADR include:
- Case examination
- Private judging
- Neutral evaluation
Arbitration is probably the most common type of ADR after mediation. While mediation is an informal type of litigation, arbitration is more like a trial. There are simplified rules of evidence as well as limited discovery, and the results are binding.
Neutral evaluation involves presenting a dispute to a third party who comes up with a non-binding reasoned evaluation, and private judging is when the two individuals who are disputing hire a third party, usually a former judge, to make a decision about their case.
Usually, lawyers are called upon in ADR to represent the parties as well as act as the neutral third parties.
3. You Do Not Need to Have an Attorney – But It Is Beneficial
You may not need to have an attorney for alternative dispute resolution, but it certainly helps. If you’re dealing with complex legal issues, then you need an experienced attorney to examine all sides of the case, gather evidence, write up the necessary legal documents, and file all paperwork appropriately. A typical business owner with no legal training can’t easily accomplish these tasks (and most won’t want to, either).
ADR isn’t supposed to favor either side at the outset, but if the other party has a lawyer and you do not, you’ll most likely begin the process at a disadvantage. An attorney can use their specialized training and experience to advocate for you and present compelling arguments and evidence. And when you hire a capable attorney, you can trust them with the legal process so you can focus on more important priorities, like running your business.
Law Offices of Kari Santana: Innovative West Michigan Business Lawyers
Considering adding a mediation or arbitration agreement to a new or existing business contract? Call the Law Offices of Kari Santana for more information on how to get started. At the Law Offices of Kari Santana, our business lawyers are experts at analyzing contracts and cases to determine the most cost-effective and profitable method of resolving business disputes for our clients. If you have an existing mediation or arbitration agreement, we can help you file the paperwork necessary to proceed in these alternative dispute resolution methods.
The content provided here is for informational purposes only and should not be construed as legal advice on any subject.